3 Tutorials that teach Budget Constraints: Change in Price
Take your pick:
Budget Constraints: Change in Price

Budget Constraints: Change in Price

Author: Catherine Barry
This lesson will explain Budget Constraints: Change in Price
See More
Try a College Course Free

Sophia’s self-paced online courses are a great way to save time and money as you earn credits eligible for transfer to over 2,000 colleges and universities.*

Begin Free Trial
No credit card required

27 Sophia partners guarantee credit transfer.

245 Institutions have accepted or given pre-approval for credit transfer.

* The American Council on Education's College Credit Recommendation Service (ACE Credit®) has evaluated and recommended college credit for 21 of Sophia’s online courses. More than 2,000 colleges and universities consider ACE CREDIT recommendations in determining the applicability to their course and degree programs.


Notes on "Budget Constraints: Change in Price"

Terms to Know

Budget Constraint

The graphical depiction of consumer income relative to the  price of goods available. Where the budget constraint touches the highest  indifference curve available, the consumer is defined to be optimizing consumption.


The cost of goods or services.

Income Effect

Consumers’ purchasing power changes as income changes,  affecting demand for a good or service.

Substitution Effect

When income decreases or price rises, cheaper goods and services are consumed instead of the more expensive alternative.